Starting an LLC: Where to begin?

1) So, basically, the whole capital value thing gets handled by an authorized court expert, and you gotta pay them for their time, I guess.
2) You're pretty much just lending money to the company itself.

cosmicbadger13 said:I’m in the process of setting up an LLC, and I’ve run into a few gray areas where I could use some guidance from those who have been through this.

1. If my intention is to contribute 50% of the initial capital through physical assets rather than cash, what does the valuation process look like for used equipment?
For instance, I have a laptop, a smartphone, and some office furniture that I’d like to roll into the company’s holdings.
Do I need to draft a formal bill of sale? Who actually determines if these valuations hold water given they aren't brand new, and how on earth do you execute a purchase agreement when the entity doesn't legally exist yet?

2. Once I kick off my first contract, I’ll need to inject some working capital.
Since this is my own money, what is the proper way to move it into the business account? Is it handled via a formal loan agreement, or is there a more standard way to do it?

Look, you can track down a certified appraiser on your own. You can basically sit down with them and work out an assessment that fits your specific needs. You suggest the value of the assets you're bringing into the business—whatever number works for you. I mean, obviously, you shouldn't go overboard and try to scam anyone, but I think you get my point.
I know for a fact it works that way. 😁

Anthony Bennett6 said:I’m a bit confused about why you’re opening up now if you aren't planning to launch for another five or six months... by then, federal regulations could have changed completely!

The guy literally said he’s got a killer name for his business and doesn't want to lose out on it.

Right, I also neglected to ask whether one is permitted to touch the initial capital while the company is actively operating? For instance, when looking to fund specific projects or various other investments.

Of course

So you're telling me there aren't actually any restrictions on how one handles their initial capital?

Nope.

Hey there! I have a question that isn't really about starting a business from scratch, but more about managing an existing LLC...
My dad used to run an LLC that was doing great. Aside from him, I’m listed as a director, though I’ve never actually worked there (one of the previous directors stepped down, so my dad added me to the paperwork). To make a long story short, my dad has fallen ill to the point where he won't be able to work again, and the company isn't really active right now. We haven't filed for bankruptcy or anything, and there aren't any debts—we just keep filing zeroed-out tax returns...
Since I'm seriously considering starting my own thing alongside my current job, I'm torn. Should I try to keep this LLC going (maybe update the directors and add some new business activities) or would it be better to sell it, shut it down, and just start as a sole proprietor?
It feels kind of pointless to close one door just to open another, even if starting fresh feels "cleaner" since I wouldn't have any old baggage attached...
What should my first steps be? I suppose I'd need to remove my dad as director (probably based on medical certification?), check if our current registered activities cover what I want to do, and see if I can actually start working before all that is sorted out...
Thanks so much for any advice! Best... 😉

I appreciate the input from everyone.

You have to file those changes through the Commercial Court where the corporation is officially registered. To get everything processed, you’ll need to attach supporting documentation regarding the appointment and any structural changes, all presented as notarized documents—meaning you'll need to visit a public notary.

To be perfectly honest, if you’ve already been appointed as director, have your startup capital ready, and your entire business structure is already set up, I don't see much sense in registering as a sole proprietorship just to take on a whole new set of overhead costs. Plus, there's a catch: for certain industries, you actually need to have passed a master's certification exam (for specialized trades), hold specific professional credentials (you should check the Small Business Act via the Federal Register, www.federalregister.gov), or alternatively, hire a manager who meets those qualification requirements. There's also the matter of taxes and insurance; registering as a sole proprietor automatically triggers mandatory pension and various other insurance payments regardless of whether you're technically "employed" or not—it happens by default the moment you register. With an LLC, however, you simply don't run into those specific headaches.

Hey there!

I've been chewing on this for a while now. I want to get my whole family involved in a business. We already have an established company—it's a brewery—so we'd be looking at repurposing the current setup. We've got some decent capital set aside, but where do I actually put it? Where's the smart move?
Real estate and commercial space aren't an issue; we've got plenty of that available...

My relatives are obsessed with blackberries, snails, and all those other "farming" headaches...

Alright, everyone, help me out. Where would it be worth investing about $25,000 to $30,000 so we can all work together? Something low-key we can run after our regular day jobs?
What could we produce and sell to turn a profit? I'm leaning towards some kind of light manufacturing... but what exactly?!?????

I don't think the answer is nearly as simple as what you're asking. Sure, anyone can jump into any kind of business, but the real question is whether they actually have the chops to pull it off. You need to look at your collective resources—and I’m not just talking about the bank account, but everything else you've got working for you.

Grace Kern2 said:I don't think the answer is nearly as simple as what you're asking. Sure, anyone can jump into any kind of business, but the real question is whether they actually have the chops to pull it off. You need to look at your collective resources—and I’m not just talking about the bank account, but everything else you've got working for you.

I have a question and could use some guidance.

I have some capital and want to get into the cafe rental business.
Keeping things simple, should I set up an LLC or a sole proprietorship under the Small Business Act?
Since I haven't run a business before, which route is more logical for a beginner?
Once I've established one of those, what comes next?
If anyone with actual experience could outline the steps required to get a cafe up and running, I would appreciate it.

Thanks.🙏

I just need some basic outlines to get moving in the right direction once.
The complexities of tax law are something I can tackle later on.

At this stage, all I have is my initial capital and the drive to succeed.
Any guidance would be appreciated.

Harold King77
If you’re looking to set up an LLC, you have to factor in the filing fees and registration costs at the Commercial Court, along with the required $6667 initial capital investment. The beauty of the LLC route is that there aren't any specific professional certifications required just to get the doors open.
However, if you decide to go the sole proprietorship route under the Small Business Act, things get a bit more complicated regarding credentials. You actually need specific training. For instance, if you aren't a trained hospitality professional and don't have the industry experience to back it up, you’ll either need to pass a certification exam for food and beverage service or hire someone who holds those qualifications to act as your manager.
And honestly, that is just the tip of the iceberg. To find the most straightforward path through the red tape, I’d suggest heading straight to the local Department of Commerce office. Once you get there, you can speak with a specialist who deals specifically with small business licensing; they can provide direct answers to all your specific queries. Before you even think about opening for business, inspectors will come out to your location to verify that you meet every single requirement laid out in the Health and Safety Code. You can find the full list of legal requirements over at www.federalregister.gov—just search for the Health and Safety Code pertaining to hospitality operations.
That document outlines everything required within your physical space, ranging from the number of sinks and basins in the WC, to having visible price lists, posted regulations, and a properly maintained Complaint Log.
Furthermore, before you officially launch, you’ll need to coordinate with the health inspectors. They’ll walk you through the specifics of mandatory work attire, hygiene standards, and even the local noise ordinances for operating a cafe in your area...

So, in a nutshell, that’s the roadmap. Start with the Department of Commerce, move on to the health inspectors, and go from there. If anything else crosses your mind, feel free to ask 😍

Here is my situation:

I’m currently employed at a company, and I'm looking to launch my own business in "partnership" with my current employer. My new venture would basically complement what they already do.
My boss is actually willing to provide office space, equipment, and might even cover payroll for the first six months if I decide to hire a small team right away.
I'm fine with covering the initial startup costs and seed capital myself.

The tricky part is how to structure this partnership fairly, without them being able to block me if I eventually want to go fully independent.

Should we handle this through ownership stakes in an operating agreement? Like 50:50? Or maybe 51:49 in my favor?

Or should I be the 100% owner, but we write into the contract that they get a cut of the profits? If so, how much?

How do people usually handle these kinds of setups?

Ideally, I’d love to be the sole director of this new LLC and avoid giving them any actual equity. I'd rather just pay them a percentage of the profits from each project instead.

Am I asking for too much?
I don't think so. The nature of the work is about 95% intellectual capital (which is me) and only 5% other resources.

I have a friend whose boss helped him start a company seven years ago by providing some initial contracts and an office. After that, the support dried up. The boss held 51% and my friend had 49%. Through pure grit and sacrifice, my friend turned that company into one of the top players in the country for their niche. He recently decided to buy out his majority partner to go solo, but he had to take out a massive loan and put up his personal assets as collateral. Now he's finally independent, but he's staring down a huge debt. It feels like he had to build the company twice.

Looking for suggestions. 😕 😕 😕

Thanks!

I’d say you need to nail down ownership stakes—aim for at least 51% or 55% if you want control. The split depends on how you guys play it, but profit sharing should always follow those ownership percentages.

I don't know the ins and outs of this perfectly, but from what I've gathered, there isn't really a way to split profits unless you both actually own the company.

If you're planning on giving him a cut per project, you really ought to sign a separate contract for every single one. If you don't want to go that route, he won't have any claim to the money—and trust me, he's not stupid.

Whether you're asking for too much is subjective, really. What matters is what's realistic. Ownership is based on what everyone brings to the table. From what I can tell, your contribution is just yourself and the cash. That team you're building? They aren't "contributions"—they're employees getting a paycheck. Your only real leverage is negotiating with the boss to snag a bigger percentage.

Contributions can be cash, assets, or rights, so basically

My employer is willing to provide the office space, all the equipment, and even cover payroll for six months if I decide to hire a team right out of the gate.

Based on that, he's contributing the space—but you need to figure out if he's just letting the new company use it or if the company will actually own it. Either way, you can put a dollar value on it. If it's just usage rights, just look at the market rental rate for that period and there's your number. Same goes for funding payroll and the equipment. Once you see his total value, you'll know exactly how much capital you need to inject to hit that 51% or 55% mark. You can't really put a price tag on yourself or the people you hire...

Who acts as CEO is up to you guys, but if things stall, the person with the majority stake makes the final call. If you want the power to make decisions, make sure you grab that majority share.

You keep saying intellectual capital is the whole game here, but is it really that simple? You'd start the company alone if it were, but nothing is ever quite black and white, right?

My boss and I are starting a business together, but his idea was to pay my portion of the initial capital for me. People like that are rare, though—and I won't be walking away with the majority stake.

Also, make sure the operating agreement includes a clause stating that if a partner wants out, they have to offer their shares to you first.

And honestly, just do your homework—talk to a lawyer and read the actual laws.

Maybe this is a bit of a silly question, but does anyone know if ownership structures for an LLC are actually public record? Like, how do you even find them? Is there a specific website or some government agency you can just hit up to see who actually owns a company—not just the CEO, but the actual owners? I’m thinking about a situation where you don't have any business ties to the firm and no obvious reason to be digging, so I'm wondering if it's even possible.

pobaj ovdje

Jacob Long said:I’d say you need to nail down ownership stakes—aim for at least 51% or 55% if you want control. The split depends on how you guys play it, but profit sharing should always follow those ownership percentages.

I don't know the ins and outs of this perfectly, but from what I've gathered, there isn't really a way to split profits unless you both actually own the company.

If you're planning on giving him a cut per project, you really ought to sign a separate contract for every single one. If you don't want to go that route, he won't have any claim to the money—and trust me, he's not stupid.

Whether you're asking for too much is subjective, really. What matters is what's realistic. Ownership is based on what everyone brings to the table. From what I can tell, your contribution is just yourself and the cash. That team you're building? They aren't "contributions"—they're employees getting a paycheck. Your only real leverage is negotiating with the boss to snag a bigger percentage.

Contributions can be cash, assets, or rights, so basically

My employer is willing to provide the office space, all the equipment, and even cover payroll for six months if I decide to hire a team right out of the gate.

Based on that, he's contributing the space—but you need to figure out if he's just letting the new company use it or if the company will actually own it. Either way, you can put a dollar value on it. If it's just usage rights, just look at the market rental rate for that period and there's your number. Same goes for funding payroll and the equipment. Once you see his total value, you'll know exactly how much capital you need to inject to hit that 51% or 55% mark. You can't really put a price tag on yourself or the people you hire...

Who acts as CEO is up to you guys, but if things stall, the person with the majority stake makes the final call. If you want the power to make decisions, make sure you grab that majority share.

You keep saying intellectual capital is the whole game here, but is it really that simple? You'd start the company alone if it were, but nothing is ever quite black and white, right?

My boss and I are starting a business together, but his idea was to pay my portion of the initial capital for me. People like that are rare, though—and I won't be walking away with the majority stake.

Also, make sure the operating agreement includes a clause stating that if a partner wants out, they have to offer their shares to you first.

And honestly, just do your homework—talk to a lawyer and read the actual laws.

My employer is just letting me use the office space.

What's his role? He provides the workspace and we tackle certain projects together. That's why I brought up the idea of him taking a percentage of the profit per project.

If I absolutely have to give up equity, I’d want it to be around 30%, because:

If the deal falls through, I can just start my own LLC and do the exact same thing. I might have less work at first and fewer resources, but I'll be independent.

On the other hand, he’d lose his best talent and the steady income he gets from my firm. For him, it's basically an investment.

Again, this is all professional services. We aren't talking about heavy machinery or expensive equipment or anything like that.